CMS Shares First Final Rule to Revitalize the ACA in 2022

Exciting news for the Individual Marketplace. On January 14th, the Centers for Medicare and Medicaid Services (CMS) issued the first final rule confirming several provisions for the annual Notice of Benefit & Payment Parameters for 2022. This response addresses several pain-points the public had after reviewing the proposed 2022 payment notice once it became available in November 2020.

The rule was created with the intent to lower consumer costs, empower states to develop their own plans, accelerate innovation, and clarify program requirements.

“The actions we’re taking today ensure these improvements can continue tomorrow because we must never be satisfied when too many Americans still cannot afford coverage in the individual market” CMS Administrator, Sema Verma, stated.

Key takeaways of the first final rule include:

• Providing extra protection for consumers who have coverage through certain Health Reimbursement Arrangements (HRAs)
• Reducing premiums by lowering user fee rates
• Enhancing Consumer Experience through Exchange Direct Enrollment
• Giving clarity on building plans that do not have a traditional provider network
• Expect changes to regulations to take effect on March 15, 2021 and continue throughout the 2022 coverage year.

Keep reading for a breakdown of these future changes.

Protecting Individuals Covered Through Certain Health Reimbursement Arrangements (HRAs)

To provide additional protection for individuals enrolled in individual coverage health reimbursement arrangement (ICHRA) or qualified small employer health reimbursement arrangement (QSEHRA), the 2022 payment notices specifies that qualified health plans (QHPs) issuers must accept all premium payments made using any of the payment methods that issuers were approved for under previous rulings.

Both direct payments from an individual coverage HRA or QSEHRA and premium payments made by enrollees must be recognized.

Reducing Premiums Through Lower User Fee Rates

Starting in the 2022 plan year, the user fee for insurers offering plan through the Marketplace will decrease to 2.25 % of total monthly premiums, and issuers offering plans through State-based Exchanges on the Federal Platform (SBE-FP) will see a user fee rate of 1.75 %. This 0.75-point decrease from the 2021 plan year reflects CMS’s past cost-saving initiatives and their desire to create a chain-reaction that will lead to lower premiums for consumers.

Enhancing Consumer Experience Through the Exchange Direct Enrollment Option

Under the new “Exchange Direct Enrollment option,” approved private sectors and Direct Enrollment entities (such as web-brokers) will serve as a user-friendly way for consumers to compare and enroll in QHPs.

Instead of a single exchange enrollment website, approved Direct Enrollment entities can run private-sector websites that can also enroll individuals into a QHP and give a determination of eligibility for coverage, advance premium tax credit (APTC) and cost-sharing reductions (CSRs). The Exchange will still be responsible for all back-end eligibility and enrollment functionalities used by Direct Enrollment entities.

Providing clarity on building plans that do not have a traditional provider network

Health and Human Services (HHS) provided clarity to the issue surrounding QHP regulatory requirements. Approved QHPs, that do not vary benefits based on “in-network” or “out-of-network” care, do not need to conform to network adequacy standards. This clarification provides added support to an already industry accepted exclusion for plans that do not alter benefits based on network status.

Additional changes will be addressed in a second final rule to be published at a later date.

The first final rule will not have a direct impact on what you can sell or how. However, as advisors, it is critical to stay up to date on all rulings from CMS, should these topics come up in conversation with employers or consumers. As these updates arise, the W3LL team will be here to keep you in the loop!

Check out the entire press release from CMS here, and stay tuned for additional commentary from our team on how the final rule affects the future of health insurance.